Cfx 1 01. Decription or transaction June 1: Byte of Accounting, Inc. issued 2,580 shares of its common stock to Jeremy after $25,750 in cash and computer equipment with a fair market value of $38,750 were received. 02 June 1: Byte of Accounting, Inc. issued 1,942 shares of its common stock after acquiring from Courtney $33,750 in cash, computer equipment with a fair market value of $14,000 and office equipment with a fair value of $800. 03 June 1: Byte of Accounting, Inc. acquired $75,000 in cash from Anna Knox and issued 3,000 shares of its common stock. 04. June 2: A down payment of $32,000 in cash was made on additional computer equipment that was purchased for $160,000. A five-year note was executed by Byte for the balance. os. June 4: Additional office equipment costing $700 was purchased on credit from Discount Computer Corporation 06. June 8: Unsatisfactory office equipment costing $140 was returned to Discount Computer for credit to be applied against the outstanding balance owed by Byte. 07 June 10: Byte paid $24.500 on the balance it owed on the June 2 purchase of computer equipment. 08. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $5,304 in cash. The effective date of the policy was June 16. 09. June 16: Computer consultation revenue of $8,000 was received 10. June 16: Byte purchased a building and the land it is on for $119,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $19,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $11,900 and executed a mortgage for the balance. The mortgage is payable in eight equal annual installments beginning July 1. 11. June 17: Cash of 57,200 was paid for rent for Junc, July, August and September. Put the total amount into the Prepaid Rent account 12 June 17: Received a bill of $375 from the local newspaper for advertising 13. June 21: Billed various miscellaneous local customers $4,600 for consulting services performed June 21. A fex machine for the office was purchased for $850.cash Introduction @ Welcome Chart of Account FAQ Transactions Wrap Test Paste 14. June 21: A fax machine for the office was purchased for 5850 cash. 15. June 21: Accounts payable in the amount of $560 were paid. 16. June 22: Paid the advertising bill that was received on June 17. 17. June 22: Received a bill for $1,115 from Computer Parts and Repair Co. for repairs to the computer equipment. 18. June 22: Paid salaries of $985 to equipment operators for the week ending June 18. 19. June 23: Cash in the amount of $3,685 was received on billings. 20. June 23: Purchased office supplies for S555 on credit. Record the purchase as an increase to the assets. 21. June 28: Billed $5,385 to miscellaneous customers for services performed to June 25 22 June 29: Cash in the amount of $5,101 was received for billings. 23. June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co. 24. June 29: Paid salaries of $985 to equipment operators for the week ending June 25. 25. June 30: Received a bill for the amount of $865 from O&G Oil and Gas Co. 26. June 30: Paid a cash dividend of $0.16 per share to the three shareholders of Byte. (IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.] Adjusting Entries - Round to two decimal places. 27 The rent payment made on June 17 was for June, July, August and September. Expense the amount associated with one month's rent. 28. A physical inventory showed that only $225,00 worth of office supplies remained on hand as of June 30. 29 The annual interest rate on the mortgage payable was 8.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16 Introduction FAQ Welcome A Chart of Accounts Transactions Pante Mergeac A4 x fx 29. The annual interest rate on the mortgage payable was 8.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 2 2. 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance 5 31 A review of Byte's job worksheets show that there are unbilled revenues in the amount of $5,750 for the period of June 28-30. 3 7 32. The fixed assets have estimated useful lives as follows: Building - 31.5 years Computer Equipment - 5.0 years Office Equipment - 7.0 years Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building's scrap value is $8,500. The office equipment has a scrup value of $400. The computer equipment has no scrap value. Calculate the depreciation for one month 33. A review of the payroll records show that unpaid salaries in the amount of $591 are owed by Byte for three days, June 28 - 30. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based on a 360 day year. [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $128,000. On June 10, eight days later, 524,500 was repaid. Interest expense must be calculated on the $128,000 for eight days. In addition, interest expense on the $103,500 balance of the loan (5128,000 less $24,500 - 5103,500) must be calculated for the 20 days remaining in the month of June.) 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tex line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] Closing Entries 36. Close the revenue accounts Ichthon Introduction FAQ Welcome Chart of Accounts Transactions Home Insert Draw Page Layout Formulas Data Review View Tell me Paste Wrap Text Morge & Center we H A B C D E A Byte of Accounting, Inc. General Journal Note: You can anlynier data into the yellow filed cells Transaction Date Debit Account Name Description Credit OT 02 03 04 05 06 07 08 09 Introduction FAO Welcome Chart of Accounts Geng -ayout Formulas Data Review View Arial 12 ou BIU V ilil fix A B D E F G H A Byte of Accounting, Inc. Income Statement For Month Ending January 0, 1900 Revenues Computer & Consulting Revenue Expenses Rent Expense Salary Expense Advertising Expense Repairs & Maint. Expense Ol & Gas Expense Supplies Expense Interest Expense Insurance Expense Depreciation Expense Total Expenses Net Income Before Tax Income Tax Expense und die Net Income After Tax ame Insert Draw Page Layout Formulas Data Review View Tell me X Arial 10 AA aste Wrap Te Merge & fx D E A Byte of Accounting, Inc. Statement of Changes in Retained Earnings For Month Ending January 0, 1900 Total Balance Beginning of Period Net Income Dividends Balance, End of Period 4 5 6 7 8 19 30 31 32 13 14 5 415 a Introduction FAD W domu Cfx 1 01. Decription or transaction June 1: Byte of Accounting, Inc. issued 2,580 shares of its common stock to Jeremy after $25,750 in cash and computer equipment with a fair market value of $38,750 were received. 02 June 1: Byte of Accounting, Inc. issued 1,942 shares of its common stock after acquiring from Courtney $33,750 in cash, computer equipment with a fair market value of $14,000 and office equipment with a fair value of $800. 03 June 1: Byte of Accounting, Inc. acquired $75,000 in cash from Anna Knox and issued 3,000 shares of its common stock. 04. June 2: A down payment of $32,000 in cash was made on additional computer equipment that was purchased for $160,000. A five-year note was executed by Byte for the balance. os. June 4: Additional office equipment costing $700 was purchased on credit from Discount Computer Corporation 06. June 8: Unsatisfactory office equipment costing $140 was returned to Discount Computer for credit to be applied against the outstanding balance owed by Byte. 07 June 10: Byte paid $24.500 on the balance it owed on the June 2 purchase of computer equipment. 08. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $5,304 in cash. The effective date of the policy was June 16. 09. June 16: Computer consultation revenue of $8,000 was received 10. June 16: Byte purchased a building and the land it is on for $119,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $19,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $11,900 and executed a mortgage for the balance. The mortgage is payable in eight equal annual installments beginning July 1. 11. June 17: Cash of 57,200 was paid for rent for Junc, July, August and September. Put the total amount into the Prepaid Rent account 12 June 17: Received a bill of $375 from the local newspaper for advertising 13. June 21: Billed various miscellaneous local customers $4,600 for consulting services performed June 21. A fex machine for the office was purchased for $850.cash Introduction @ Welcome Chart of Account FAQ Transactions Wrap Test Paste 14. June 21: A fax machine for the office was purchased for 5850 cash. 15. June 21: Accounts payable in the amount of $560 were paid. 16. June 22: Paid the advertising bill that was received on June 17. 17. June 22: Received a bill for $1,115 from Computer Parts and Repair Co. for repairs to the computer equipment. 18. June 22: Paid salaries of $985 to equipment operators for the week ending June 18. 19. June 23: Cash in the amount of $3,685 was received on billings. 20. June 23: Purchased office supplies for S555 on credit. Record the purchase as an increase to the assets. 21. June 28: Billed $5,385 to miscellaneous customers for services performed to June 25 22 June 29: Cash in the amount of $5,101 was received for billings. 23. June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co. 24. June 29: Paid salaries of $985 to equipment operators for the week ending June 25. 25. June 30: Received a bill for the amount of $865 from O&G Oil and Gas Co. 26. June 30: Paid a cash dividend of $0.16 per share to the three shareholders of Byte. (IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.] Adjusting Entries - Round to two decimal places. 27 The rent payment made on June 17 was for June, July, August and September. Expense the amount associated with one month's rent. 28. A physical inventory showed that only $225,00 worth of office supplies remained on hand as of June 30. 29 The annual interest rate on the mortgage payable was 8.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16 Introduction FAQ Welcome A Chart of Accounts Transactions Pante Mergeac A4 x fx 29. The annual interest rate on the mortgage payable was 8.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 2 2. 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance 5 31 A review of Byte's job worksheets show that there are unbilled revenues in the amount of $5,750 for the period of June 28-30. 3 7 32. The fixed assets have estimated useful lives as follows: Building - 31.5 years Computer Equipment - 5.0 years Office Equipment - 7.0 years Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building's scrap value is $8,500. The office equipment has a scrup value of $400. The computer equipment has no scrap value. Calculate the depreciation for one month 33. A review of the payroll records show that unpaid salaries in the amount of $591 are owed by Byte for three days, June 28 - 30. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based on a 360 day year. [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $128,000. On June 10, eight days later, 524,500 was repaid. Interest expense must be calculated on the $128,000 for eight days. In addition, interest expense on the $103,500 balance of the loan (5128,000 less $24,500 - 5103,500) must be calculated for the 20 days remaining in the month of June.) 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tex line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] Closing Entries 36. Close the revenue accounts Ichthon Introduction FAQ Welcome Chart of Accounts Transactions Home Insert Draw Page Layout Formulas Data Review View Tell me Paste Wrap Text Morge & Center we H A B C D E A Byte of Accounting, Inc. General Journal Note: You can anlynier data into the yellow filed cells Transaction Date Debit Account Name Description Credit OT 02 03 04 05 06 07 08 09 Introduction FAO Welcome Chart of Accounts Geng -ayout Formulas Data Review View Arial 12 ou BIU V ilil fix A B D E F G H A Byte of Accounting, Inc. Income Statement For Month Ending January 0, 1900 Revenues Computer & Consulting Revenue Expenses Rent Expense Salary Expense Advertising Expense Repairs & Maint. Expense Ol & Gas Expense Supplies Expense Interest Expense Insurance Expense Depreciation Expense Total Expenses Net Income Before Tax Income Tax Expense und die Net Income After Tax ame Insert Draw Page Layout Formulas Data Review View Tell me X Arial 10 AA aste Wrap Te Merge & fx D E A Byte of Accounting, Inc. Statement of Changes in Retained Earnings For Month Ending January 0, 1900 Total Balance Beginning of Period Net Income Dividends Balance, End of Period 4 5 6 7 8 19 30 31 32 13 14 5 415 a Introduction FAD W domu